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Illinois recently became the latest jurisdiction requiring certain employers to offer a commuter transit benefit to employees, starting in 2024 (“IL Commuter Benefit Program”). Illinois now joins New Jersey along with the following cities in mandating commuter benefit programs: Berkeley, CA, Los Angeles, New York City, Philadelphia, Richmond, CA, Seattle, San Francisco Bay Area, and Washington, D.C.
On July 28, 2023, Illinois passed the “The Transportation Benefits Program Act” to promote employees commuting to and from their workplaces on public transit. The IL Commuter Benefit Program will be effective on January 1, 2024.
Covered employers under the IL Commuter Benefit Program include all employers that employ 50 or more covered employees (see definition below) within designated towns and counties in Illinois at an address located within one mile of fixed-route transit service.
The list below details these designated locations under the IL Commuter Benefit Program:
An employee is covered under the IL Commuter Benefit Program if they perform an average of at least 35 hours of work per week for compensation on a full-time basis within the locations listed above. Newly hired employees will be eligible for the IL Commuter Benefit Program starting on the first full pay period after 120 days of employment.
All covered employers must provide a pre-tax commuter benefit for covered employees to purchase a transit pass through payroll deduction. A transit pass is any pass, token, fare card, voucher, or similar item entitling a person to transportation on public transit.
The IL Commuter Benefit Program must satisfy the federal rules under Internal Revenue Code §132(f) for qualified transportation expenses. For 2023, the maximum pre-tax monthly amount for qualified transportation expenses is $300.
Bona Fide Collective Bargaining Agreements: The IL Commuter Benefit Program requirements may be waived in a bona fide collective bargaining agreement provided the waiver is set forth explicitly in such agreement in clear and unambiguous terms.
Employers covered under the IL Commuter Benefit Program are advised to review their current employee commuter benefit program to ensure full compliance by January 1, 2024.
If a covered employer already offers a commuter benefit program that complies with the IL Commuter Benefit Program, no further action is required for January 1, 2024.
For those covered employers without a current commuter transit benefit program in place, Risk Strategies is here to help. Contact your Risk Strategies team members for further assistance or email us directly at email@example.com.